James Clark McReynolds

“ Both courts below ruled that gain derived by the petitioner from redemption of bonds during 1927, 1928 and 1929 was not 'capital gain' within the meaning of the controlling statutes.
No contest exists concerning the facts. The narrow point as counsel agree is this-Must the redemption of bonds before maturity by the issuing corporation be treated as tantamount to a sale or exchange of capital assets within the meaning of section 208 (a) (1) , Revenue Act 1926, and section 101 (c) (1) , Revenue Act 1928. ”

“ In 1929 the Board of Tax Appeals held otherwise. Werner v. Commissioner, 15 B.T.A. 482. But in 1932 it definitely overruled that determination. Watson v. Commissioner, 27 B.T.A. 463.
The revenue Act 1934 (May 10, 1934, c. 277, 48 Stat. 680, 714-715) provides-
'Sec. 117. (§ 101.) Capital gains and losses. ”